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TMI Blog2013 (7) TMI 411X X X X Extracts X X X X X X X X Extracts X X X X ..... nufacturing various types of process gas compressors. The return of income for the year under consideration was filed by it on 28-10-2004 declaring total income of Rs. 18,31,88,230/-. In the assessment completed u/s 143(3) of the Act vide an order dtd. 27-12-2006, the total income of the assessee was computed by the A.O. at Rs. 22,11,87,370/- after making certain additions which were sustained by the ld. CIT(A) in the quantum proceedings to the following extent:- (i) disallowance of repairs and maintenance expenses treating the same as capital in nature Rs. 20,73,464/-. (ii) disallowance of technical and administrative expenses representing adhoc provision made by the assessee without any basis Rs. 42,22,348/-. (iii) disallowance out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereof was made merely on the basis of difference of opinion, penalty u/s 271(1)(c) of the Act was not attracted. The submissions made by the assessee were not found acceptable by the A.O. According to him, all the additions made to the total income of the assessee represented disallowance of higher claim for deduction made by the assessee and since the higher claim were made by furnishing inaccurate particulars of income by the assessee, penalty u/s 271(1)(c) of the Act was leviable. Accordingly he imposed penalty of Rs. 3907,835/- u/s 271(1)(c) of the Act being 100% of the tax sought to be evaded by the assessee in respect of additions made to the total income of the assessee. 4. The penalty imposed by the A.O. u/s 271(1) of the Act was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure on the part of the assessee to establish that the same were revenue in nature. He contended that the genuineness of the said expenditure, however, was not disputed and depreciation thereon was allowed by the A.O. after capitalizing the said expenses. He contended that the disallowance on account of repairs and maintenance expenses thus was based on difference of opinion and the issue involved relating to the exact nature of expenses being a debatable one, penalty u/s 271(1)(c) of the Act cannot be imposed. In support of this contention, he relied on the decision of co-ordinate Bench of this Tribunal in the case of DCIT vs. Shivalik Global Ltd. (2011) 8 ITR 761(Delhi) and DCIT vs. Eagle Iron and Metal Industries reported in (2011) 11 ITR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of plant & machinery and building were claimed by the assessee amounting to Rs. 58,43,979/- and Rs. 23,63,343/- respectively. According to the A.O., the said expenses to the tune of Rs. 14,48,341/- and Rs. 6,25,123/- were capital in nature and this view of the A.O. was accepted by the assessee apparently because the A.O. allowed depreciation on the said expenses treated as capital. The action of the A.O. in allowing the depreciation on the said expenses clearly shows that genuineness of the same was not disputed by him and the fact that the said expenses were related to the business of the assessee was also accepted by him. In the similar facts and circumstances involved in the case of DCIT vs. Shivalik Global Ltd. (supra), Delhi B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e disallowance of 50% made by the A.O. to 10%. It is thus clear that adhoc disallowance of 50% out of miscellaneous expenses was made by the A.O. on estimated basis and the said estimate was revised by the ld. CIT(A) while restricting the disallowance to 10%. It was thus a case of disallowance made on estimated basis for want of supporting voucher and there was no case that any bogus expenses not relating to its business were claimed by the assessee under the head miscellaneous expenses. In the similar facts and circumstances involved in the case of DCIT vs. Eagle Iron and Metal Industries Ltd. (supra), the co-ordinate Bench of this Tribunal has held that where disallowance had been made purely on the basis of difference of opinion and on a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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